Blogs

How to Avoid HR Headaches When Confronting Employees Who Abuse Company Vehicles

If an employee threw trash all over the office floor, scratched the paint off the walls, broke the light bulbs, left holes and dents in the walls, and skipped routine maintenance on the copier until it overheated and broke, no manager would tolerate this abuse.

Yet, that is exactly what some fleet managers do tolerate when drivers abuse their company-provided vehicles.

One approach to resolving vehicle abuse is to make the condition of a vehicle part of an employee’s annual job review. Anecdotal evidence suggests this approach results in better-maintained vehicles. For instance, one company does an annual vehicle condition report with each driver. This company not only pays for the vehicle reconditioning expense, but also the salary expense for the inspection. The company found, on average, the vehicles regularly inspected by managers, who prepare written condition reports, were in better condition than other vehicles at the end of service.

Other companies, however, decide not to adopt this policy. One reason is that managers dislike doing the inspections, making the process an administrative nightmare. Also, many employees are field workers, who may live hundreds of miles from office locations and their managers. The employee would have to drive in for inspections, logging travel time for the appraisal. Many companies opt instead for a diverse and attractive selector to entice drivers to buy the vehicle at end of service, which encourages employees to take better care of their assigned vehicles.

However, if your company decides to add vehicle condition to an employee’s job review, there are several issues you need to discuss with your human resources department, including:

Research if Policy Violates State Law: Some state labor laws may prohibit the use of vehicle condition reports to measure employee performance. In addition, you run into possible HR problems if the policy isn’t applied equally to everyone. You cannot give the appearance that the policy is being applied selectively to some employees and not others. As with all disciplinary action, you need to be prepared to impose it for everyone from the CEO on down. Some nationally dispersed fleets include a provision in their fleet policy guidelines stating that drivers are financially liable for damage to their company-provided vehicle if it was caused by negligence. However, this practice is illegal in some states.

Be Consistent in Vehicle Evaluations: It is necessary to develop consistency in vehicle evaluations between reviewers. The reality is, some managers will be knowledgeable, looking at the vehicle carefully, while others will simply say that it is normal wear-and-tear by the fleet application. Special attention should be given if vehicles are transferred to other drivers. In these situations, it is hard to pinpoint who failed to maintain the vehicle.

Regularly Issue Condition Reports: To avoid problems from becoming bigger problems, managers must perform condition reports on a regular basis and be consistent in the evaluations for all employees.

Danger of Employee Circumvention of Policy: Employees will attempt to circumvent accident reporting procedures and obtain out-of-network repairs to avoid being cited for company vehicle abuse during their employment review.

Increased Administrative Workload: Increased workload is one of the drawbacks. This monitoring system requires drivers and managers to complete a vehicle condition report each time a vehicle is transferred to another employee. Likewise, it will require more administrative involvement by the fleet department in resolving disputes between employees and managers over vehicle condition.

Possibility of Management Abuse: Ensure managers do not corrupt the system by using it as a tool to terminate employees.

Withdrawal of the Company Vehicle Privilege

Each of your drivers and their managers should know the rules governing the use of a company vehicle. Not only should your drivers be aware of these rules, but they must also understand what actions will be taken for non-compliance. In extreme situations, you will be responsible to withdraw the privilege of using a company vehicle from blatantly abusive drivers. But, it is important to work closely with HR when implementing this policy.

Legislation

Market Trends

Change is percolating in the management of multinational fleets, which is being driven by global market dynamics, evolving procurement trends, and technology platform upgrades that are facilitating cross-border management of individual country fleets.

In a six-month analysis, the FMCSA reported hours of service (HOS) violations have steadily decreased, which is good news and a testament to the efficacy of ELD technology. However, there continue to be negative unintended consequences caused by the constraints and inflexibility with HOS rules that hinder compliance.

Three challenges consistently high on the list for many fleet managers — improving driver safety, mitigating the high cost of fuel, and complying with corporate pressures to reduce fleet’s contribution to the company’s global carbon footprint.

The recent U.S tax law changes created a problem for employers who use a non-accountable vehicle reimbursement plan. Negative feedback has some companies reconsidering the viability of offering company-provided vehicles to help key employees mitigate the adverse impact of eliminated tax deduction.

A truck’s total cost of ownership (TCO) covers a specific range of expense variables, regardless of the make or model. The four lifecycle categories that influence TCO are fixed costs, operating expenses, incidental costs, and depreciation/resale value. A key factor that drives these lifecycle categories is a vehicle’s service life.

Most in procurement take the position that fleet’s primary responsibility is to buy assets and services, which annually can range from millions to tens of millions of dollars in expenditures. This amount of corporate spend requires it be managed by someone with superb negotiation skills and proven procurement acumen.

If you want to provide added value to your company, you need to view fleet as a business and not simply an aggregation of assets to be managed cost-effectively. The fastest way to improve your bottom line is to increase fleet utilization, which increases the productivity of each individual truck.

Blog: Vocational trucks are susceptible to being targeted for staged accidents, which involves maneuvering an unsuspecting employee driver into an intentional crash in order to make a false insurance claim or to file a lawsuit against the driver’s employer.

If you think being a fleet manager is stressful, try being a Navy SEAL. Former Navy SEAL Robert O'Neill, best known for claiming to have shot Osama bin Laden, recently wrote a new book entitled, “The Operator.”

Conventional wisdom in the fleet market is often wrong. If we roll back the calendar, the conventional wisdom about fuel prices was that there would be ebbs and flows in price per gallon rates, but the overall price trajectory would trend upward. The flaw with conventional wisdom is that it only works when no new variables are inserted into future projections. A case in point is the shale oil revolution, which now has experts predicting oil prices will remain flat for the foreseeable future.

Summer is a busy time in fleet. There’s an abundance of next-model-year OEM fleet meetings, new-model intros, and industry conferences, which offer ample opportunities to “talk fleet” with the movers and shakers of our industry. If you want to know what's happening in the fleet market, you need to talk with fleet managers -- lots of them.

Senior management exerts intense pressure on fleet managers to control and/or reduce vehicle acquisition and operating expenses. To accomplish this, a fleet managers can pursue three different cost-control strategies — cost savings, cost deferral, or cost avoidance. In order to implement a successful cost-control strategy you need to institutionalize the mechanisms to curb money-wasting behaviors.